Custom, Excise & Service Tax Tribunal
Nvidia Graphics Pvt Ltd vs Commissioner Of Service Tax Bangalore ... on 13 January, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: ST/20672/2016-SM [Arising out of Order-in-Appeal No. 5 to 17/2016 dated 29/01/2016 passed by Commissioner of Central Excise (Appeals-II), BANGALORE ] Nvidia Graphics Pvt Ltd C1-jacaranda, Wing-A, Manyata Embassy Business Park, Outer Ring Road BANGALORE - 560045 KARNATAKA Appellant(s) Versus Commissioner of Service Tax BANGALORE SERVICE TAX- I 1ST TO 5TH FLOOR, TTMC BUILDING, above BMTC BUS STAND,DOMLUR BANGALORE, - 560071 KARNATAKA Respondent(s)
Appearance:
Mr. Sachin Aggarwal, CA For the appellant Mr. Pakshi Rajan, AR For the respondent Date of Hearing: 13/01/2017 Date of Decision: 13/01/2017 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order No. 20064 / 2017 Per : S.S GARG The present appeal is directed against the impugned order dated 29.1.2016 vide which the Commissioner (A) has allowed the refund of CENVAT credit relating to few input services; and denied the refund on other input services mainly on the ground of nexus; and with regard to few services he has not given any reason for the rejection of the refund of CENVAT credit; and with regard to few services, he has held that it does not fall in the definition of input services under Rule 2(l) of CENVAT Credit Rules (CCR), 2004. The period involved in this appeal is October 2009 to March 2010 which is prior to the amendment to the definition of input service which was effected from 1.4.2011.
2. Briefly the facts of the case are that the appellant is engaged in the business of providing software development services and marketing support services to its group entities located outside India. The said services are being provided under Rule 3 of Export Service Rules, 2005. In order to provide the taxable output service, the appellant used various taxable input services and availed CENVAT credit of service tax paid on such input services as per the provisions of CCR, 2004. As the appellants are unable to utilize the CENVAT credit, they filed refund of unutilized CENVAT credit in respect of input services under Rule 5. Thereafter a show-cause notice was issued and the original authority partially granted refund of service tax paid on input services and partially rejected the same vide its Order-in-original dated 29.2.2012. Thereafter, appellant filed appeal before the Commissioner (A) who also allowed refund with regard to few services and rejected for other services. Aggrieved by the order of the Commissioner (A), the appellant has filed the present appeal.
3. Heard both the parties and perused the records.
4. Learned CA for the appellant submitted that the impugned order rejecting the refund of CENVAT credit in respect of input services is wrong and not sustainable. He further submitted that all these services for which refund has been denied fall in the definition of input service as held by various decisions of the Courts from time to time. He further submitted that the period involved in the present appeal is prior to 1.4.2011 when the definition of input services was very wide as held by various courts and it includes any service which is in or in relation to business or for providing output service. For this, he relied upon the following decision.
i. Coca Cola India Pvt. Ltd. vs. The Commissioner of Central Excise, Pune-III: 2009 (242) ELT 168 (Bom.) ii. CCE, Hyderabad-IV vs. Deloitte Tax Services India Pvt. Ltd.: 2008-TIOL-629-CESTAT-BANG.
iii. M/s. Dell International Services India Pvt. Ltd. vs. CCE, Bangalore: 2009-TIOL-1957-CESTAT-BANG.
5. On the other hand, the learned AR reiterated the findings of the impugned order.
6. I have heard both sides and perused the records. The learned CA for the appellant has given the decisions of the Tribunal and the High Court in support of his submission that all the services fall in the definition of input service. The following is the table of input service and the decisions rendered by various courts regarding the nexus of the same.
Category Nexus Air travel agent service M/s. Dr. Reddys Lab Ltd. vs. CCE, Hyderabad: 2010-TIOL-194-CESTAT-BANG.
CCE, Tirunelveli vs. DCW Ltd.: 2011 (22) STR 214 (Tri.-Chennai) Architect Service M/s. Dell International Services India Pvt. Ltd.: 2009-TIOL-1957-CESTAT-BANG.
Club or Association Service M/s. Conexant Systems Pvt. Ltd. vs. CCE: 2016-TIOL-617-CESTAT-HYD.
Company Secretary Services Heartland Bangalore Transcription Services (P) Ltd. vs. CST, Bangalore: 2011 (21) STR 430 (Tri.-Bang.) Custom House Agent Service CCE vs. Rajkot vs. Rolex Rings P. Ltd.: 2008 (230) ELT 569 (Tri.-Ahmd.) Event Management Service Hindustan Coca Cola Beverages Pvt. Ltd. vs. CCE, Meerut-II: 2010 (251) ELT 125 (Tri.-Del.) Interior Decorator Service Shree Bhawani Paper Mills Ltd. v. CCE, Lucknow: 2012 (28) STR 409 (Tri.-Del.) Outdoor Caterers Service CCE, Mumbai v. GTC Industries Ltd.: 2008 (12) STR 468 (Tri.-LB) Heartland Bangalore Transcription Services (P) Ltd. vs. CST, Bangalore: 2011 (21) STR 430 (Tri.-Bang.) Pandal and Shamiana Service Public Relations Management Service Real Estate Agent service Shreno Ltd. vs. CCE, Bangalore: 2014 (35) STR 963 (Tri.-Bang.) CCE, Delhi vs. Convergys India Pvt. Ltd.: 2009 (16) STR 198 (Tri.-Del.) Rent-a-cab Service M/s. Hindustan Coca-Cola Beverages Pvt. Ltd. vs. CCE, Hyderabad: 2010-TIOL-160-CESTAT-BANG.
M/s. Dr. Reddys Lab Ltd. vs. CCE, Hyderabad: 2010-TIOL-194-CESTAT-BANG.
Renting of Immovable Property CST, Bangalore vs. Mercedes Benz Research & Development India (P) Ltd.: 2013 (30) STR 257 Sponsorship Service Supply of tangible goods 6.1 The learned CA further submitted that with regard to input service of Pandal and shamiana service; public relation management service; sponsorship service and supply of tangible goods service, all these services fall in the definition of input service.
6.2 Coming to the Pandal and Shamiana service, he submitted that such services have been availed for arranging chairs through contractors in relation to business meetings with clients and during big conferences/events arranged for the business promotion and these services are indirectly used in relation business activity and therefore, credit in respect thereof should be admissible.
6.3 Similarly with regard to supply of tangible goods, the learned CA submitted that appellant takes certain office equipments like printers, systems, testers, etc., on hire and use them to provide its output services.
6.4 Similarly with regard to sponsorship service, he submitted that the appellants are directly related to organizing business event and promotional activities carried out by the appellant for enhancing the image of its products and these services are not excluded from the definition of input service. Therefore appellants are entitled for the same.
6.5 Further coming to the input service of public relation management service, the learned CA submitted that the appellant uses these services of public relation firm to enhance its image in the IT and communication space which in turn helps the appellant to gain and retain clients/customers/vendors and these services are directly concerned with the business promotion of the appellant and therefore the credit in respect of the same should be available to the appellant.
6.6 In my considered view, all these services also fall in the definition of input service if the same are used for the purpose of rendering output services.
7. Considering the various decisions cited supra, I am of the opinion that the impugned order denying the refund of CENVAT credit with regard to these services is wrong and not sustainable and therefore I allow the appeal of the appellant and set aside the impugned order. The original authority will grant refund subject to verification of the document. Therefore appeal is allowed by way of remand.
(Operative portion of the Order was pronounced in Open Court on 13/01/2017.) S.S GARG JUDICIAL MEMBER rv 7